The yen touched a seven-year low against the dollar after a report showed Japan’s economy unexpectedly shrank for a second quarter.
Japan’s currency extended a four-week rout as the gross domestic product data added to speculation Prime Minister Shinzo Abe will delay a planned increase in the sales tax and call a general election. New Zealand’s dollar gained for a fifth day, the longest winning streak since May, after a report showed retail sales increased more than economists estimated. Australia’s currency rose to the highest this month before an expected free-trade agreement with China, the nation’s biggest export market.
“It is an overwhelmingly negative report and certainly confirms the market’s idea that the sales tax will be pushed back significantly,” said Raiko Shareef, a Wellington-based markets analyst at Bank of New Zealand Ltd.
The yen tumbled as much as 0.7 percent to 117.05 per dollar, the weakest since October 2007, before trading at 116.42 as of 9:11 a.m. in Tokyo from 116.29 on Nov. 14. Japan’s currency slid 0.3 percent to 146.08 per euro.
The 18-nation euro was little changed at $1.2537 from last week. New Zealand’s kiwi rose 0.4 percent to 79.38 U.S. cents. Australia’s currency was at 87.58 U.S. cents after earlier touching 87.82, the highest since Oct. 31.
Source: Bloomberg (17 Nov 2014)
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